™

Cambridge IGCSE

BUSINESS STUDIES 0450/23

Paper 2 Case Study May/June 2023
INSERT 1 hour 30 minutes

INFORMATION
• This insert contains the case study.
*3747335787-I*

• You may annotate this insert and use the blank spaces for planning. Do not write your answers on the
insert.

This document has 4 pages. Any blank pages are indicated.

06_0450_23_2023_1.13
© UCLES 2023 [Turn over
 2

Regency Rugs (RR)

RR manufactures rugs made from wool. It only sells its products in country Z. Many of RR’s competitors
are multinational companies. RR is a private limited company which has been operating for 5 years and
has a reputation for excellent customer service. RR’s directors want the business to expand but are
aware that this can have problems as well as benefits.

RR produces machine manufactured rugs in its factory. These rugs are standardised and have a similar
design so they are quick to produce. They are sold at a low price.

RR’s Operations Manager wants to increase the productivity of the workers in the factory. This could
be achieved by introducing new technology or by increasing employee training. The cost of both options
will need to be considered.

RR’s directors are considering expanding by selling its rugs in new markets in other countries. The
Managing Director thinks that using ecommerce will be the best way to achieve this expansion. A website
would need to be created to enable the business to take orders for their rugs and to receive payments
from customers. RR will need to communicate the expansion plans to its employees.

The Marketing Manager knows that RR needs to identify a suitable method of promotion for its rugs
when it enters the new markets. Market research has been carried out to help identify the best method
of promotion to use. An extract from this research can be found in Appendix 1.

Appendix 1

Extract from the market research results for the new markets in other countries

90
80
70
% of population

60

50
40
30
20

10
0
watch TV watch sport drive a car

© UCLES 2023 06_0450_23_2023_1.13

 3

Appendix 2

Organisational chart for RR

Managing Director

Finance Director Operations Director Marketing Director Human Resources

Director

Financial Factory Manager Sales Manager Administration officer

Assistants
(2)
Factory Supervisors Salesperson
(3) (3)

Production employees
(30)

Appendix 3

Extract from RR’s income statement

2021 2022

Revenue $25m $32m

Cost of Sales $10m $16m

Expenses $10m $8m

© UCLES 2023 06_0450_23_2023_1.13

 4

BLANK PAGE

Permission to reproduce items where third-party owned material protected by copyright is included has been sought and cleared where possible. Every
reasonable effort has been made by the publisher (UCLES) to trace copyright holders, but if any items requiring clearance have unwittingly been included, the
publisher will be pleased to make amends at the earliest possible opportunity.

To avoid the issue of disclosure of answer-related information to candidates, all copyright acknowledgements are reproduced online in the Cambridge
Assessment International Education Copyright Acknowledgements Booklet. This is produced for each series of examinations and is freely available to download
at www.cambridgeinternational.org after the live examination series.

Cambridge Assessment International Education is part of Cambridge Assessment. Cambridge Assessment is the brand name of the University of Cambridge
Local Examinations Syndicate (UCLES), which is a department of the University of Cambridge.

© UCLES 2023 06_0450_23_2023_1.13